Spain is a big country, but when it comes to home sales the market is highly concentrated in a handful of places on the coast and Madrid.
The map above, created using data from the Housing Department of the Ministry of Public Works (Fomento), illustrates the concentration of the Spanish housing market (2017). There are basically six big markets: Madrid, Barcelona, Alicante, Malaga, Valencia, and the Balearics, which between them account for almost half (49.5%) of all home sales in Spain.
With the exception of Madrid, which was plucked out of obscurity to be the capital of Spain by Philip II in 1561, all the big markets are on the coast and are popular with foreign buyers. The rest of Spain is vast and beautiful, but largely empty of people and house-hunters.
A good sized housing market offers some reassurance to buyers and sellers that they will find a counterparty when they want to transact. I see this as particularly important when buying, as it helps to know there will probably be buyers around when you come to sell. It’s simply a question of numbers – the more buyers and sellers in a market, the lower the risk of getting stuck with an asset nobody wants.